The power challenge

The electric power sector is a major contributor to Sri Lanka’s
balance of payments problems, due to the need to import fossil fuels for
thermal generation, partly because the country has no control over
international petroleum prices. However, the process of power planning,
over which the authorities did have control, was seriously mismanaged
for three decades. It is the cost of that mismanagement for which we are
now paying.

A major planning issue was the non-recognition of the part of the
powers that be that electricity demand and supply cannot be taken in
isolation from other factors, ecological, economic, social and
technological. For example, the deforestation of watersheds led to the
depletion of retention capacity and hence to heavy discharge during
rainy periods combined with mere trickles in dry periods, which means
larger reservoirs are required for storage.

Power consumption

The major impacts on power consumption have been economic and social.
This is clearly discernible in the manner in which sectoral demand has
altered. In the 1970s, industrial consumption accounted for well over
half of the total electrical used. The opening of the economy to
uncontrolled imports led to the collapse of the manufacturing sector. By
1987, industrial consumption of electricity had fallen to 38 percent;
while today it floats around the one third mark.

Incredibly, one single social factor - the introduction of islandwide
television services - had greater effect than all others. Earlier the
general population used to spend the hours of twilight and early
darkness chatting with neighbours at the ‘junction’, on the roadside or
verandah, but now sits indoors in front of the TV during peak viewing
time.

This practice has led to a sharp peak in electricity demand during
these hours, in contrast with the energy consumption pattern in
developed countries, where the demand is generally flat at all hours,
give or take small fluctuations from the mean. Peak demand is now
approximately 2,200 MW, about one third higher than at any other time of
the day. After the peak, power demand falls to about 700 MW in the early
hours, climbing to about 1,400 MW during the daytime.

Peak hours

With the completion of the Mahaweli hydro-electric projects in the
late 1980s, about half of the potential for estimated hydro-electric
generation was taken up. At this point, the amount of electricity
generated by thermal power stations was smaller than the losses in
transmission (15-20 percent of generated power).

In order to cut down on the power losses and to take up extra peak
demand, thermal power stations in proximity to the Colombo urban
agglomeration were mooted. Ideally, this capacity would have been under
the direct control of the Ceylon Electricity Board (CEB) and it would be
fully utilised only at peak hours.

Instead, thermal power generation licences were granted to private
operators who, for sake of economy, located their plant in distant areas
- precluding savings on transmission losses. Since private operators
need to maximise profit, power purchase agreements were concluded for
generation at non-peak times as well, thereby obviating raison d’etre -
the need to bridge the peak demand gap.

The cost of thermal energy being higher than hydro-electric, this
meant an increase in power costs all round; it also meant that the
cheaper hydro-electricity capacity should be kept idle at off-peak
times, further increasing costs.

Wind and solar power generation

While in the 1970s only 10 percent of households electrified, today
over 80 percent are; the government expects this to rise to 98 percent
by 2016. This has exacerbated the peak demand conundrum, which has led
to the introduction of even more thermal plant and hence to rising
costs. Today half of our electricity is generated by thermal power
stations. The government intends to reduce the thermal requirement by
increasing non-conventional renewable generation capacity to 10 percent
by 2016 and more thereafter. Unfortunately solar power generation runs
(obviously) only during daylight hours, while wind is unavailable in the
drought months of March to May.

Electricity generation by renewables will get more important as time
goes on, as world petroleum resources get depleted and as costs increase
accordingly.

The biggest obstacle is the problem of peak consumption. In order to
reduce the peak, the CEB would like to introduce lower off-peak tariffs
to commercial and industrial users; this would enable especially
industrial users to cut down on costs by working night shifts. However,
this is only a partial solution, and will tend only to increase thermal
generation.

Anyway, industry consumes a far smaller proportion than it used to.

There are several solutions which could be considered. One of them is
Ocean Thermal Energy Conversion (OTEC), which uses the heat difference
between the top and bottom of the sea, and for which Trincomalee is
considered a good site. The plant would be flexible enough to run at
maximum capacity during peak hours. The CEB is also considering energy
storage, allowing electricity generated in off-peak hours to be
accumulated. Being considered is a proposal by the Mahaweli Authority to
re-direct water through a route yielding more power for water to be
pumped to higher-elevation reservoirs, for use in peak hours (as is done
in developed countries).

Energy tax

Wind and solar power generation could also be usefully deployed for
pumping water to higher levels. The CEB envisages that storage chillers
could be used by establishments which require air-conditioning during
the peak hours (for example cinemas, theatres and restaurants) to
utilise electricity generated in the off-peak hours.

There is one further solution, which unfortunately is expensive (but
may prove cheaper in the long run). This is to subsidise sales of
low-energy TV and similar equipment and impose an energy tax on
electricity-devouring plasma TVs. The widespread use of LED
(light-emitting diode) TVs instead of cathode-ray sets could cut
electricity consumption by two thirds, substantially reducing peak load.

Whatever solutions adopted, this must be done within the framework of
a holistic plan, to avoid the type of catastrophic mistakes made in the
past.